Judge Kerry Bensinger, Case 20STCV02428 2023-05-03 Tentative Ruling

On January 21, 2020, Plaintiff Lilly Baharestani filed thisaction against defendants Global Logistics Transportation, Inc. (“GLT”), ProCare, Inc., Borris E. Johnson, and Dana Patra Cabrera (“Cabrera”) for injuries arising from a multi-vehicle accident. Plaintiff filed the First Amended Complaint on January 22, 2020. GLT filed a cross-complaint against Cabrera on May 17, 2021 for indemnification, apportionment of fault, and declaratory relief.

On February 24, 2023, Cabrera filed an Application for Determination of Good Faith Settlement.

On March 21, 2023, GLT filed this Motion Challenging the Good Faith of Settlement between Plaintiff and Cabrera.

“Any party to an action in which it is alleged that two or more parties are joint tortfeasors or coobligors on a contract shall be entitled to a hearing on the issue of the good faith settlement entered into by the plaintiff or other claimant and one or more alleged tortfeasors or coobligors….”¿ (Code of Civ. Proc., § 877.6.)¿ Good faith settlements further two sometimes competing policies: (1) the equitable sharing of costs among the parties at fault, and (2) the encouragement of settlements.¿ (Erreca’s v. Superior Court (1993) 19 Cal.App.4th 1475, 1487.)¿¿

The Court must consider several factors including “a rough approximation of plaintiffs’ total recovery and the settlor’s proportionate liability, the amount paid in settlement, the allocation of settlement proceeds among plaintiffs, and a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial.”¿ (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499 (Tech-Bilt).)¿¿“Other relevant considerations include the financial conditions and insurance policy limits of settling defendants, as well as the existence of collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.” ¿(Id.)¿¿¿

The evaluation of whether a settlement was made in good faith is¿ required to “be made on the basis of information available at the time of settlement.”¿ (Tech-Bilt, supra, 38 Cal.3d at p. 499.) ¿“[A] court not only looks at the alleged tortfeasor’s potential liability to the plaintiff, but it must also consider the culpability of the tortfeasor vis-à-vis other parties alleged to be responsible for the same injury.” ¿(TSI Seismic Tenant Space, Inc. v. Superior Court (2007) 149 Cal.App.4th 159, 166.)¿ “Potential liability for indemnity to a nonsettling defendant is an important consideration for the trial court in determining whether to approve a settlement by an alleged tortfeasor.”¿ (Id.)¿¿

In City of Grand View Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261, the court provided the following guidance regarding a motion for a good faith settlement determination:¿¿

“If the good faith settlement is contested, section 877.6, subdivision (d), sets forth a workable ground rule for the hearing by placing the burden of proving the lack of good faith on the contesting party. Once there is a showing made by the settlor of the settlement, the burden of proof on the issue of good faith shifts to the nonsettlor who asserts that the settlement was not made in good faith. If contested, declarations by the nonsettlor should be filed which in many cases could require the moving party to file responsive counterdeclarations to negate the lack of good faith asserted by the nonsettling contesting party.”

Terms of the Settlement

Under the terms of the settlement, Cabrera agrees to pay $15,000 to Plaintiff in exchange for a release from any and all claims, known and known.¿ (Application, p. 2.) The settlement amount represents Cabrera’s insurance policy limits. The Application and supporting declaration state that Cabrera does not have any other insurance policies or assets to contribute to Plaintiff’s damages. (Lira Decl., ¶¶ 4, 5.)

Analysis

GLT argues that Cabrera’s Application fails to establish that the settlement was made in good faith because (1) the Application relies solely on Cabrera’s exhaustion of her insurance policy limits and does not meaningfully discuss any other Tech-Bilt factor, and (2) the settlement amount does not fairly reflect Cabrera’s proportionate liability.

GLT is correct that Cabrera’s Application eschews any in-depth discussion of other Tech-Bilt factors. However, if Cabrera has tendered her full policy limits and does not possess any other insurance policies or assets to contribute to the settlement, that factor alone may be dispositive to a determination of good faith. A settling defendant’s modest financial condition and insurance policy limits are necessarily controlling and effectively override the other Tech-Bilt factors. (County of Los Angeles v. Guerrero (1989) 209 Cal.App.3d 1149, 1158.)

Here, Cabrera offers the Declaration of Sandy V. Lira, Cabrera’s attorney, to establish her modest financial condition. (See Lira Declaration.) GLT contends that Lira lacks personal knowledge to assert that Cabrera lacks assets to contribute to the settlement. The Court agrees. Lira’s declaration is insufficient to establish Cabrera’s financial condition. Cabrera does not offer any other evidence on the issue. Because Cabrera does not adequately discuss the Tech-Bilt factors or her role in the underlying incident, or provide sufficient evidence to establish her financial condition, the Court will continue the hearing to provide Cabrera an opportunity to submit her declaration and for counsel to more fully discuss the Tech-Bilt factors.

Based on the foregoing, the Court CONTINUES the hearing on the challenge to the good faith settlement to June 2, 2023 at 1:30 p.m. in Department 27 of the Spring Street Courthouse to allow Defendant/Cross-Defendant Dana Patra Cabrera¿to address the Tech-Bilt factors, explain her role in the incident, and furnish evidence of her financial condition. Cabrera is to file her supplemental papers no later than May 15, 2023 and GLT may file any opposition no later than May 24, 2023.

Moving party to give notice.

Dated: May 3, 2023 ___________________________________

Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the Court at SSCDEPT27@lacourt.org indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org.¿ Please be advised that if you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear at the hearing and argue the matter.¿ Unless you receive a submission from all other parties in the matter, you should assume that others might appear at the hearing to argue.¿ If the Court does not receive emails from the parties indicating submission on this tentative ruling and there are no appearances at the hearing, the Court may, at its discretion, adopt the tentative as the final order or place the motion off calendar.¿